Business
Partnership connects 3,000 farmers in Rwenzori and Elgon regions to Post Bank
Representatives of NGOs that nurtured the farmers to form VSLAs says the Partnership will increase access to services like fertilizers
Head of Fintech Business at PostBank Uganda Brenda Mpoora (L), guiding a farmer on how to use the Wendi Mobile Wallet while Roger Gilbert Nyakahuma (Center Back), the IFDC BRIGHT project Financial Inclusion Manager and farmers look on. This was held in Budwale Sub County, Mbale District, where Wendi by PostBank engaged with the community
Post bank Uganda has signed a Partnership agreement with Building Resilience and Inclusive Growth of Highland Farming System for Rural Transformation) BRIGHT project in which the bank has promised to pay the farmers 10% interest per annum of daily savings.
The bank has further promised to enable the members of the predominantly farming communities, better security for their money and cheaper credit than what they were spending when borrowing from their VSLAs.
According to BRIGHT project baseline survey results conducted in Rwenzori, Kigezi and Elgon regions where the project is being implemented, the main bottlenecks to financial inclusion include the high cost of financial services due to high interest rates that range from 22% to 120% per annum.
VSLAs also have a high interest rate, limited awareness of available financial services and products by smallholder farmers, lack of brick-and-mortar branches for financial institutions in the project area and collateral requirements that hamper VSLAs/farmer groups and women/youth access to financial services among others.
Additionally sharing of all saved funds at the end of the cycle (12 months) by VSLAs limits the availability of funds for lending at the beginning of the new cycle as well and financial products and services offered by FSPs (Financial Service Providers) are not tailored to the needs of smallholder farmers.
Speaking at the launch of the partnership and onboarding of the smallholder farmers, Brenda Mpoora, Head of Fintech Business at PostBank Uganda highlighted the bank’s commitment to fostering prosperity for Ugandans which requires innovative approaches of tailoring financial services and products to enable communities to participate in social economic activities like agriculture which employs most Ugandans.
“Through Wendi mobile wallet solution, we are glad to continue the journey of empowering users and groups, particularly those with limited access to traditional financial services to access a savings account where they can secure their savings and earn a 10% interest per annnum on their daily savings, as well as perform financial transactions and access credit,” Ms. Mpoora said.
She added, “The partnership between IFDC/BRIGHT and Wendi wallet that we are witnessing today is a great opportunity for our farmers to be equipped with financial literacy so that they know how they can access financial services conveniently, which services can be accessed by both PostBank and non-PostBank customer’s.”
Agriculture is the predominant economic activity in rural areas which harbor about 76 percent of Uganda’s population. The sector employs about 70 per cent of the working population and provides the first job for three-quarters of those aged between 15 and 24 years. The NDP III identifies agriculture as one of the key growth opportunities with the highest potential to generate employment and have positive multiplier effects on other sectors. It has played a central role in Uganda’s economy accounting for 26.42 per cent of the country’s exports at a growth rate of 3.8 percent and forming 1.65 per cent of the GDP.
Roger Gilbert Nyakahuma, the IFDC BRIGHT project Financial Inclusion Manager acknowledged PostBank Uganda for joining efforts with IFDC/ BRIGHT to bridge the financial inclusion gap through alternate digital transaction platforms like Wendi mobile wallet which is a game changer in scaling the access to financial services in areas where there are no physical banking facilities.
“The objective of this partnership is therefore to facilitate the linkage of BRIGHT project VSLAs to the Wendi mobile wallet solution to improve access to financial products and services as well as address some of the challenges that were identified during the BRIGHT project baseline survey conducted in Rwenzori, Kigezi and Elgon regions where the project is being implemented,” Nyakahuma said.
He adds, “Our partnership with Wendi is 1300 VSLA across Elgon, Rwenzori and Kigezi regions and each VSLA has an average of about 25-20 members. This means that we are targeting at least 40,000 farmers and for the Elgon region, we are targeting 121 VSLA and an average of 3000 farmers.”
About PostBank Uganda
PostBank Uganda (PBU) is fully fledged commercial bank, owned by the Government of Uganda.
It was incorporated under the Companies Act in 1998 and has grown its branch network to 58 countrywide.
About Wendi Mobile Wallet
Launched in November 2023, Wendi is PostBank’s innovative mobile wallet, designed to offer seamless financial services to underserved and last-mile customers. Through Wendi, users can access, manage, and transact funds efficiently. Since its inception, Wendi has onboarded over 1.3 million subscribers and works with 4000 agents countrywide.
Wendi mobile wallet is licensed by the National Payments System Act.
In collaboration with the government of Uganda, PostBank Uganda through Wendi mobile wallet has been able to support the implementation of some of projects, payment of Parish Development Model funds to beneficiaries, and disbursement of relief funds to Bududa landslide victims among others.
About IFDC:
The International Fertilizer Development Center (IFDC) began in 1974 with the mission to improve soil fertility and crop nutrition in tropical regions. Since then, IFDC has grown to encompass an array of agricultural solutions — market development, policy advocacy, fertilizer technology development, project implementation in the field, farm mechanization, and micronutrient research. For more information, visit www.ifdc.org
About Agriterra
Agriterra is an international, not-for-profit Dutch Agri-agency that works in emerging and developing economies. Agriterra aims to make value chains work for organized farmers to accelerate rural transformation.
Agriterra is in a consortium with IFDC under the BRIGHT project market component aimed at professionalizing and strengthening the capacity of farmer groups, SACCOs, and producer cooperatives. The goal is to improve smallholder farmers’ access to credit, inputs, and output markets. In light of this, Agriterra is taking the lead in providing technical assistance to make these farmer organizations bankable.
BRIGHT:
IFDC in partnership with the Embassy of the Kingdom of Netherlands (EKN) is implementing a new project; “Building Resilience and Inclusive Growth of Highland Farming Systems for rural Transformation (BRIGHT) Project”. The BRIGHT project’s vision is to promote inclusive economic growth and rural transformation of over 100,000 households through equitable integration into value chains using the Farming Systems Approach in Mt. Elgon, Kigezi and Rwenzori Regions.
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